ING IM’s money market fund bucks redemption trend

Assets in ING Investment Management’s Liquid Euro money market fund have jumped 28% since the end of 2011 to €6bn, despite heavy redemptions from other European money market funds.

The Liquid Euro Fund had €4.7bn of assets under management at the end of 2011 but has recently seen significant net inflows from corporate clients in Belgium, France and the Netherlands.

In 2010 its assets were nearly half the current figure at €3.7bn.

Several fund groups have attributed strong inflows to investor interest in France. The Paris offices of UK group M&G Investments and US firm Muzinich & Co have recently announced high inflows from French investors.

Other asset managers are recognising the potential offered by the French market. Lately US group Russell Investments and Australian company First State Investments reinforced their presence in the region.

EFAMA statistics show that European money market funds experienced a slight comeback towards the end of 2011. They recorded net inflows of €20bn in November, compared to net outflows of €10bn in October.

Nonetheless 2011 was a tough year for European money market industry with €34.4bn of outflows recorded up until November, Efama data shows.

Wim Veraar, head of money markets at ING Investment Management and manager of the Liquid Euro Fund, attributed its commercial success to its risk adjustment and defensive positioning, enabling it “to buck the trend.”

Despite volatile market conditions, Veraar said he expected the fund to continue to grow.

The fund invests in various money market instruments, including short-term bonds, floating rate notes, deposits and commercial papers. It was launched in 2002.

Figures from Efama show the European money market industry is currently worth €1.139bn.